The report examines CFC’s own claims and enquiry data from the last five years to assess the factors that have been driving growth, identify key trends and investigate the most common types of claims.
Key findings
- Digital health and hybrid healthcare enquiries are set to overtake traditional healthcare enquiries, totalling 49% of total enquiries in 2021
- While the US still dominates the digital health space, demand and adoption for digital healthcare insurance is surging in the UK, Canada and Australia
- Artificial intelligence (AI) companies have seen a 32% increase in policy and enquiry count over the last year
- AI-related intellectual property (IP) claims are outpacing traditional healthcare incidents making up nearly a fifth of digital healthcare claims
- 70% of claims have come from areas which would not be covered under a traditional medical malpractice solution
- The frequency of cyber incidents has quadrupled in 2021
Digital healthcare has forced its way from the margins since we first launched our global digital health insurance proposition in 2017, to become a mainstream part of everyday life. Since then, we’ve seen enquiries for our digital health insurance jump from less than 9% of our total enquiries for healthcare insurance to hit 49% last year. This is all the more noteworthy against a backdrop of yearly double-digit growth in our traditional healthcare enquiries. Tim Boyce, Head of Professions and Healthcare, CFC
In addition to growth in demand in the UK, Canada and Australia, CFC is now seeing enquiries from a wide selection of countries including Israel, Ireland, The Netherlands, Denmark, Croatia and Singapore.
The biggest movers in digital healthcare
The biggest sector represented in CFC’s digital healthcare portfolio continues to be telemedicine, largely due to its reliance on well-established and widely accessible technology. While CFC is seeing increasing demand for cover from other digital health sectors, it continues to grow its share of CFC’s digital healthcare business, highlighting ongoing demand for such services.
Remote patient monitoring solutions now represent 12% of CFC’s overall digital healthcare portfolio. Given the pressure on hospitals and the benefits of early intervention provided by remote monitoring, there is real demand to expand the prevalence of these solutions.
Claims trends
CFC’s digital health claims experience of the past five years bears testament to the fact that providing healthcare services digitally presents exposures that traditional entities may not have had to contend with previously. Bodily injury for example can be the result of a technology failure or cyber incident.
While medical misdiagnosis remains the biggest single source of claims, IP and cyber claims represent over a third of digital healthcare claims received. Both categories could easily find themselves at the centre of a disputed liability negotiation if different insurers and different policies were involved.
Future trends
With high adoption rates and extensive funding continuing, there is no sign that the digital healthcare industry will slow down in 2023. Having assessed industry trends and its insurance enquiry demands, CFC believes:
- Digital health tools will be increasingly used to predict medical conditions or diseases
- The use of AI will become more prominent in every healthcare setting
- The increased use in technology will open the healthcare industry up to even more cyber exposures
- The sector will come under greater scrutiny by governments and regulatory bodies
“The fast developments and adoption of AI, VR and AR, especially in areas like surgery, have already seen ground-breaking results, but the risk and exposures are often left uncovered. Even general practitioners, operating largely at a traditional level, still have digital exposures and most are unaware of the consequences,” concludes Boyce. “The education of the digital health industry and those that work across it is paramount to its continued success and growth. This creates an excellent opportunity for the insurance market to work closely with clients in this sector and develop more partnership-styled relationships.”
